Apple Faces 'Massive Dilemma' With Success of the MacBook Neo (macrumors.com) 143
Apple may have a supply problem on its hands with the MacBook Neo... The laptop reportedly relies on "binned" A18 Pro chips with one GPU core disabled, and demand is so strong that the supply of those cheaper leftover chips could run out before the next model is ready. That leaves Apple choosing between lower margins, shifting production plans, or changing the lineup to keep its $599 hit product in stock. MacRumors reports: The all-new MacBook Neo has been such a hit that Apple is facing a "massive dilemma," according to Taiwan-based tech columnist and former Bloomberg reporter Tim Culpan. [...] In the latest edition of his Culpium newsletter today, Culpan said the MacBook Neo is selling so well that Apple's supply of the binned A18 Pro chips with a 5-core GPU will "run out" before the company is able to fully satisfy demand for the laptop. Apple's initial plan was to have suppliers build around five to six million MacBook Neo units before ceasing production of the model with the A18 Pro chip, he said, but it sounds like demand is so strong that Apple might run out of A18 Pro chips to put in the MacBook Neo before the second-generation MacBook Neo with an A19 Pro chip is ready next year. Apple is unlikely to mark the MacBook Neo as temporarily sold out, so it may be forced to take action, but profit margins might be affected.
A18 Pro chips are manufactured with TSMC's second-generation 3nm process, known as N3E, and Culpan said TSMC's N3E production lines are currently operating at maximum capacity. As a result, he said that Apple may have to pay a premium to restart A18 Pro chip production for the MacBook Neo, which would lower its profit margins. Apple would have to disable a GPU core on these chips to ensure that they have only a 5-core GPU, like all other MacBook Neo units sold to date. Alternatively, Culpan said that Apple could reallocate some of its chip production that was originally planned for other devices, but he said the cost would still be higher than what it paid for its initial batch of A18 Pro chips.
Culpan speculated that Apple could also opt to discontinue the $599 model with 256GB of storage, leaving the $699 model with 512GB of storage and a Touch ID button as the only configuration available. This is unlikely to happen any time soon, in our view, given how heavily Apple has been promoting the MacBook Neo's affordability. Apple might also be able to move up the release of a MacBook Neo with the iPhone 17 Pro's A19 Pro chip, but that too would be a costlier option, at least until the company achieves a sufficient stockpile of binned A19 Pro chips with a 5-core GPU. In any case, Apple could opt to keep the starting price of current and future MacBook Neo models at $599 and simply accept lower profit margins on the laptop, especially given that it attracts customers to the macOS and broader Apple ecosystem.
A18 Pro chips are manufactured with TSMC's second-generation 3nm process, known as N3E, and Culpan said TSMC's N3E production lines are currently operating at maximum capacity. As a result, he said that Apple may have to pay a premium to restart A18 Pro chip production for the MacBook Neo, which would lower its profit margins. Apple would have to disable a GPU core on these chips to ensure that they have only a 5-core GPU, like all other MacBook Neo units sold to date. Alternatively, Culpan said that Apple could reallocate some of its chip production that was originally planned for other devices, but he said the cost would still be higher than what it paid for its initial batch of A18 Pro chips.
Culpan speculated that Apple could also opt to discontinue the $599 model with 256GB of storage, leaving the $699 model with 512GB of storage and a Touch ID button as the only configuration available. This is unlikely to happen any time soon, in our view, given how heavily Apple has been promoting the MacBook Neo's affordability. Apple might also be able to move up the release of a MacBook Neo with the iPhone 17 Pro's A19 Pro chip, but that too would be a costlier option, at least until the company achieves a sufficient stockpile of binned A19 Pro chips with a 5-core GPU. In any case, Apple could opt to keep the starting price of current and future MacBook Neo models at $599 and simply accept lower profit margins on the laptop, especially given that it attracts customers to the macOS and broader Apple ecosystem.
A hammer and a nail (Score:3)
Built from leftover parts (Score:5, Funny)
Imagine the conversation in the boardroom:
"It's nearly 100% profit. We built it out of leftover parts!"
"They are selling out -we need to make more."
"...shit. We are running out of leftover parts."
"Call it a 'Limited Edition' and double the price."
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I'd imagine that they'll just discontinue the $599 model and put new A18 Pro chips with a GPU core disabled in the $699 model until it's time to upgrade to a new $699 model with the A19 Pro and 12 GB of RAM.
Sure, it would be nice if they didn't needlessly disable that 6th core, but Apple is probably already losing M5 Macbook Air sales from this thing as it is.
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Re:Built from leftover parts (Score:5, Interesting)
Why do they disable the GPU core....?
My understanding is that it was a situation where it was a failed core, not intentionally disabled. That's why they were able to write off the additional cost. Obviously I don't have precise insight into Apple's corporate mindset, though.
Re:Built from leftover parts (Score:5, Interesting)
Nordstrom's Rack got so popular they couldn't keep it stocked, and eventually started developing their own dedicated Nordstrom Rack brands, which sort of defeated the purpose of Nordstrom's Rack as it's entire value was Nordstrom's quality, late season, at a discount, but now it's discount quality with the Nordstrom's name on it.
Law of unintended consequences I guess.
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Nordstrom generally has the latest trend clothes in fashion and pretty good quality; it's known for it.
It is "known", but not really true anymore. Many items come from the same production lines in China.
A friend works at a distribution center east of Los Angeles. Ship comes into port, container put on truck, its taken out to the distribution center. There the container from China is opened and the exact same items are given Nordstrom store tags or the store tags of "lesser" stores. Then the tagged items are sent to their respective stores to fulfill orders.
Sounds like a good problem to have (Score:5, Insightful)
Apple has rarely dipped into the mass markets before now when it came to computers, the Mac mini being the rare exception, which was just a little too nerdy (needing your left over keyboard, mouse, and monitor) to actually be a mass market product. Maybe the success of their mass market non-computer stuff has helped them dip a toe in the waters.
In any case, I'm happy they're trying it and having the right kinds of problems.
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$1,295. In 1984. Wouldn't even qualify as mass market today, but in 1984... phew. To put it in perspective, by then you could get IBM PC clones for under $1,000.
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Apple //c?
That was £499 here in the UK in 1984. Meanwhile you could buy a ZX Spectrum for £175 or Commodore 64 for £299.
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iMac, iBook, white Macbook, eMac. The Classic and LC were aimed at the lower end too.
The last 15 years when Apple hasn't had a real mass consumer machine except for the mac mini have been kind of an exception. I guess that's also how long your memory works for.
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Yeah, I didn't include the Air because it's kind of dual use. There are enough examples of machines specifically targeted at home users it wasn't necessary to give the trolls more room for pedantry.
I was actually there when Jobs announced the Macbook Air. Apple was very much talking up how great it was for business users and people who travel a lot, and BTW probably a good choice for students too. Not like e.g. the clamshell iMac. It only recently got a real colour choice too, and only barely.
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There's a difference between lower end (none of these computers were even low end, just "on the lower end of Apple's offerings") and mass market. None of those devices are mass market, they're just the "non-pro" items.
The Classic, for example, was $999, which until the 2000s I believe was Apple's cheapest Mac. This was in 1990. It was still an upscale item, just slightly more accessable price wise than their Macs had been before. And its spec was basically identical to the Mac Plus, launched 5 years earlier
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Colour Classic...yeah maybe, and again as a retro machine I like them. As a contemporary machine though they were way overpriced for what they were.
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Computers were more expensive in the past. Particularly 40 years ago.
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The last 15 years when Apple hasn't had a real mass consumer machine except for the mac mini have been kind of an exception.
If you're talking about a span of hundreds of years, a span of 15 years may be an exception. A span that's one third of the company's existence is not.
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Uh huh.
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The iPod was certainly something very mainstream and mass-market.
The iPod evolved into something mainstream and mass-market, but originally it was intended as a "halo accessory" to sell Macs.
I think it's just Windows 11 sucking (Score:2)
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It's certainly a perfect time to dip their toes in the water. The last time would have been Windows Vista, and for whatever reason mass market computers, despite his success with mass market music players, didn't seem to be something Jobs was ready to do.
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Yeah Vista was when I switched over to the mac. Got a new "Made for Vista" Asus laptop that almost immediately started bluescreening and ran like shit. After the computer store refused to let me get a license for XP for free to replace Vista I just returned it as "not fit for purpose" and drove over to the Apple store and told them to give me the "elevator pitch" on why I should switch and they succeeded , and that 2006 mac ran fine till I upgraded to the 2011 which I stuck with till the M1 in 2020, though
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Yeah Vista was when I switched over to the mac.
Obligatory [youtu.be].
It's about the hardware (Score:2)
Windows 11 really isn't that bad. It's mostly that PC laptops at this price point are generally flimsy plastic crap, with washed out screens, tinny speakers, and keyboards that'll make you regret your life choices. The thing Apple really got right about it is that it's a cheap laptop that doesn't feel cheap.
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Yes, Windows 11 is really that bad. It's cluttered, slow, inconsistent. I've seen it on pretty high end hardware, and it's a dog. And that's before we even talk about how they tried to insert Copilot into everything. It's a shitty version of Windows and even Redmond acknowledges it. It was the impending EOL of Windows 10 that lead me to buy an M1 MacBook Pro, and I've never looked back. If I want to run Linux, I've got servers set up to do that kind of heavy lifting, but I have absolutely no need for whatev
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Windows 11 really isn't that bad.
That depends on your pain sensitivity. At work, they upgraded our machines from 10 to 11. Even though our version is customized to remove the ads, there are still pain points. For example, coming out of sleep does not seem like a major difference until you have to do something immediately like open Outlook calendar to see the details of your next meetings. In 10 it was responsive. It takes a full minute before Outlook responds to a basic function. Something is definitely clunky with the File Explorer as it
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Re: But ubuntu works fine for (Score:2)
This has to be the weirdest conspiracy theory I have ever heard. He must really get under your skin. I do not usually mod rsilvergun up (posts are too long, often teetering on the edge of off-topic), but now I am going to start doing it just to mess with you jack-offs.
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I remember when the Mac Mini launched at $500. It didn't take long before it re-launched at $900... and you still didn't get a mouse or keyboard.
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Current base price for a Mac Mini is $599. So, there's that.
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the Mac mini being the rare exception, which was just a little too nerdy (needing your left over keyboard, mouse, and monitor)
If that's a barrier to entry, it's one that is shared by 90% of the (non-laptop) PC market, and it never seemed to bother PC users. It's not like Apple won't happily sell you a keyboard, mouse, and monitor along with your Mac Mini, if that's what you want to do.
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the Mac mini being the rare exception, which was just a little too nerdy (needing your left over keyboard, mouse, and monitor)
If that's a barrier to entry, it's one that is shared by 90% of the (non-laptop) PC market, ...
How do you figure?!?!
I just went to dell.com, picked PC, sorted by price, clicked on the cheapest one:
https://www.dell.com/en-us/sho... [dell.com]
It includes a keyboard and mouse.
FWIW, it's $499, Ryzen 5 150 (6core), 8gb ram (with options for 16gb or 32gb), and 512gb SSD (with option for 1tb).
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Based on what? This is tremendously popular, well out of line with their regular sales.
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Apple sells between 20 and 25 million computers a year.
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Apple will likely conclude it's a bad situation. Most of these sales are people who would have bought a more expensive Mac if this one wasn't available.
Yeah you're not an Apple person are you? The vast majority of those who are would be buying the Air at a minimum or the Pro. There is still a considerable difference between the Neo and the Air/Pro especially when it comes to the display and build quality. For example the Neo has 53 screws that secure the keyboard, the Pro has over double that giving it a much more solid feeling keyboard. Air and Pro also come with larger touchpads and the Pro has a much brighter and more colour accurate screen.
Re: Sounds like a good problem to have (Score:2)
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Naw. I bought one of these Neo Macs last month.
It was a gift for my Mom who's still using a 2013 Macbook.
I'd been looking into used M1 Macs for under $500 and the chance to get a warranty new Mac, that sold me.
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Most of these sales are people who would have bought a more expensive Mac if this one wasn't available.
Need citation. Personally, I wouldn't consider a Macbook Air for the kids - it's a lot of money to be out when they drop it off the back of their bike on the way to a friend's. But the Neo, much more appealing at that price point, and perhaps more durable, and they don't need Air-level power for the stuff they're doing anyway. And for many people, it's probably between the Neo and an entry-level PC or Chromebook, at a similar price-point, rather than comparison to the Air.
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Most of these sales are people who would have bought a more expensive Mac if this one wasn't available.
Absolutely not the case. The Neo is essentially Apple's first attempt at a budget laptop, and the market segment they're targeting is entirely different.
Case in point: My dad has been a Windows user for 20+ years and has always decried Apple as "decent hardware that's overpriced and running a lobotomized operating system." However he hates Windows 11 more and decided to replace his aging Windows laptop with a Neo last week. So far he's been impressed, though is still dealing with a learning curve. I gua
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The Neo is essentially Apple's first attempt at a budget laptop, and the market segment they're targeting is entirely different.
iBook anyone? And outside of the laptops, the iMac and eMac?
IMO, this isn't so much something entirely new as much as it is a part of their cycle of dips into that market and back up into the high end. Things like this are like casting a net - they get a ton of new people trying it out, then hope they evolve into users of more and higher-end Apple stuff. Ex. iBook gets discontinued and people either move onto a MacBook/etc or go back to PC (and those that go back to PC are fine to lose cause they're probabl
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Apple is Doomed! (Score:4, Funny)
Apple makes a superior product from 'spare parts' that has the low end PC community worrying how they'll match it at that price and now they can't make enough of them to meet demand. And they do this when other vendors are worrying about where they'll find memory chips. Yup, Apple is Doomed!
Re: Apple is Doomed! (Score:2)
No PC vendor is seriously worried about a $600 Mac iPad w/ keyboard attached - they mostly all offer a lower price model Windows laptop.
It's an interesting product, it's targeted at the lower-end of the market, but it's not going put a serious crimp in any Win laptop Mfg sales.
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You may be right, but there are definitely PC vender executives who claim to be very worried about the Neo. Maybe foolishly, or maybe for once they are seeing a bigger picture, Apple is hitting one narrow slice here but in ways they can’t counter. They may be legit worried about other configurations taking other slices with no real counter.
I think Windows will provide an extremely large area for that market to “retreat” into though where Apple won’t really follow. I mean with so
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Re: Apple is Doomed! (Score:2)
I can walk over to Microcenter with $600 and walk out with a spiffy laptop with an 8 core snapdragon CPU, 16 gig of RAM and 1TB of storage - running Win 11, the same OS most companies & schools run. (Acer Aspire 14 and 16 laptops in specific)
The people excited about a $600 iPad are looking for a laptop to take the place of an iPad, and they have to be casual users that don't have specific software requirements/needs - nothing beyond a browser or office suite.
There are a lot of them, but not enough to sc
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I can walk over to Microcenter with $600 and walk out with a spiffy laptop with an 8 core snapdragon CPU, 16 gig of RAM and 1TB of storage - running Win 11, the same OS most companies & schools run. (Acer Aspire 14 and 16 laptops in specific)
Then go ahead if that is what you want. At this point, you will never buy a Mac and cannot see why someone would buy one.
A good PC is still $3000 (Score:2)
Fight me.
(please don't. I already hurt.)
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You don't need to anymore, anything that's vaguely power efficient in this space is soldered RAM now.
Framework had to go to some ancient and power hungry Intel 13th Gen on their smallest laptop to keep the socketed RAM. And their "desktop" has soldered RAM!
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There was a time when the people who complained about soldered RAM (and I was one of those people) were a significant enough proportion of the community that manufacturers would pay attention. This was the age when gaming PCs were constructed from high end pieces from the wild-assed cases to the heavy duty PSUs to overclocked CPUs and next gen GPUs.
But overall, that segment of the consumer market has dwindled. Most folks just want to charge their new machine up, connect it to their WiFi network and get goin
Re: Apple is Doomed! (Score:2)
i hate the fact that i need to go on ebay and research whether or not the laptop in offers have soldered ram.
eBay? That's your go-to for new product research?
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Re: Apple is Doomed! (Score:2)
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599 is not low end, sort of low mid range. Well, at least before AI shortages came along.
Technically $499, since the education discount is basically a pinky promise.
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Simpler solution (Score:2)
Just offer all the Neo buyers the option to purchase a refurbished base model M4 Air for the same price. Might cut the backlog a bit.
Disable a GPU core? (Score:2)
Why? Because it might upset the purchasers of the more expensive 6-core models? So, ship them with a few dead pixels and you can still call it the budget model.
No, offer an upgrade with 6 GPU cores (Score:2)
Why? Because it might upset the purchasers of the more expensive 6-core models? So, ship them with a few dead pixels and you can still call it the budget model.
No, offer an upgrade with 6 GPU cores. 5 core remains as the low end at the current price, so marketing is happy.
The only problem is that the nerfing between the Neo and Air is that much less.
Also, either there is a lot of new low end demand that Apple did not expect, or there is a lot more cannibalization of Air sales than Apple expected. Investors should look closely at any data on Air sales.
McRib (Score:2)
When you have a product made from leftover rejected parts the supply is guaranteed to be limited.
So you hype it as "for a limited time" and people go hog wild with FOMO.
coming soon: "The Neo is Back."
Re: McRib (Score:2)
Apple's initial plan was to have suppliers build around five to six million MacBook Neo units before ceasing production of the model with the A18 Pro chip
5-6 million pieces is a far cry from 'limited edition' in my opinion...
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When you have a product made from leftover rejected parts
That's the urban legend around the McRib anyway, but judging by my local Walmart's meat department, extremely low quality pork is available year-round. I think the real reason it's only seasonal at McDonalds is because if they kept it around all the time, the novelty of eating an extremely fatty slab of processed pork slathered in excessively sweet barbecue sauce, would wear off.
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At Walmart, extremely low quality everything is available year-round.
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It's been ages since I was last in a Walmart.....when I looked at the extreme poor quality of meat and even most veggies/fruit I could not believe how bad it was, and not significantly cheaper than one of the "real" grocery stores around the area.
I just can't believe people regularly shop at Walmart....at least for food....???
Obvious this was going to be a success (Score:2)
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I'm not surprised by its success, I'm just surprised that Apple are. I'm stunned their business case didn't imagine bigger volume.
The problem is that is writer's description of the issue. Apple may not consider it a "dilemma". Apple is selling off their binned A18 Pro chips that they could not sell before. Yes, Apple would like to sell as many Neos as they can but given the current state of computer manufacturing, adjusting to supply chain constraints is not easy. However, I suspect the alternative for Apple would have been to release a new Apple TV with A18 Pro. After all, the current model uses the A15 which was probably binned c
Cant see the problem really (Score:2)
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competes with the iPad w keyboard cover (Score:2)
TIL they are using crippled A8 Pro chips (Score:2)
TIL they are using crippled A8 Pro chips with one GPU core disabled.
What a way to recover from binned chips.
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Of course, I meant to type "A18 Pro chips."
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Party like its 2009 with the current RAM/Flash prices mate!
https://au.pcpartpicker.com/tr... [pcpartpicker.com]
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What are you doing on a desktop machine that uses 256gb?
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Installing more than one modern AAA title.
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It's a phone GPU with 8GB unified ram. You're not running that AAA title with any meaningfully sized textures, so no need for storage space either.
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Test show you can maintain Xbox series X framerates on Cyberpunk 2077. You're very quick to judge what people may or may not use something for.
Also no one said "Macbook Neo". The question was "What are you doing on a desktop machine that uses 256gb?"
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Installing more than one modern AAA title.
Which you're really not going to be doing on a MacBook Neo anyway.
Mostly, I'd say the biggest problem the lack of storage might cause is when you try to back up your iPhone to the Neo and it doesn't have enough space. Though, I guess Apple expects people to just subscribe to one of their paid cloud storage plans.
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Who said Macbook Neo? Read the question: "What are you doing on a desktop machine that uses 256gb?"
But even something as simple as Photoshop consumes a shitton of space these days, especially a scratch drive can quickly consume upwards of 100GB if you use generative fill liberally.
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You're joking right? 256GB is not suitable for even a standard application drive with user cache these days on normal workloads. Install Photoshop on the drive and 10% of your disk space is gone. That would be fine, but if you use generative fill on multiple layers the scratch disk ends up with AI model information cached, you will very quickly use up 100GB just of temporary scratch space to use a simple image editor.
God help you if you dare to install the Topza suite as well. The image resizing and noise r
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You're joking right? 256GB is not suitable for even a standard application drive with user cache these days on normal workloads. Install Photoshop on the drive and 10% of your disk space is gone. , . . God help you if you dare to install the Topza suite as well. The image resizing and noise reduction model alone consume 80GB
Yes because the Neo is heavily marketed to professional photographers . . . oh wait, no. It is to be a general purpose laptop. People can use Photoshop if they want to use that much disk space. That's like complaining my Honda Civic cannot carry a pallet of bricks weighing a ton. How dare Honda design my Civic that way!
These's aren't strange or unique things that normal people don't use. They are hobby tools for anyone with a camera. There's hundreds of other hobbies out there as well. The modern world requires storage.
If only made a MacBook model that is designed for professional photographers and video editors . . . maybe they should call such a model, the "Pro" or something like that. Or a less capable m
Re: 2010 called. (Score:2)
2. I like lots of storage, so I have an extra 2TB SSD. Itâ(TM)s pseudo SLC, so itâ(TM)s quite slow and bloody cheap.
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Have you seen the installation file for Vivado Design Suite? It's > 100GB. And let's not mention PetaLinux Tools.
Designing FPGAs on an entry-level consumer laptop is kind of like chasing tornadoes in a Toyota Prius.
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What's the laptop distinction? These days countless people use laptops with docking stations or external screens for complex professional work.
As for the activity of designing FPGAs, that's not a very intensive task. An entry level consumer laptop can trivially do the task. That doesn't change the fact that the underlying database for these tools are massive.
Don't be such a gatekeeper and maybe look at what people who are not you do with their computers.
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So shitty they can't make enough of them to sate demand
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Easy to claim when they artificially limit manufacturing capacity.
Re: Liars (Score:2)
Chip yields are what they are. Relying on binned chips isn't artificial supply limiting.
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Relying on binned chips isn't artificial supply limiting.
Nothing to do with it.
Re: Liars (Score:2)
Exactly
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No, I mean the binned chips has nothing to Apple artificially limiting manufacturing or what I was referring to.
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